Affimed Therapeutics' (AFMD) CEO Adi Hoess on Q1 2016 Results - Earnings Call Transcript

| About: Affimed Therapeutics (AFMD)

Affimed Therapeutics (NASDAQ:AFMD)

Q1 2016 Earnings Conference Call

May 18, 2016 8:30 AM ET

Executives

Anca Alexandru – Head-Communications

Adi Hoess – Chief Executive Officer

Florian Fischer – Chief Financial Officer

Analysts

Michael Schmidt – Leerink Partners

Do Kim – BMO Capital Markets

Maury Raycroft – Jefferies

Yale Jen – Laidlaw and Company

Anca Alexandru

I would like to welcome you to our Investor and Analyst Call on the Results for the First Quarter of 2016. On the call with me today are Adi Hoess, CEO of Affimed, who will present the corporate update; and Florian Fischer, Affimed’s CFO, who will walk you through the financials.

Before we start, please note that this call and the Q&A session contains forward-looking statements, including statements regarding our future financial condition, business strategy and our plans and objectives for future operations. These statements represent our beliefs and assumptions only as of the date of this discussion. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons why actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future.

These forward-looking statements are subject to risks and uncertainties and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including but not limited to those identified under the section entitled Risk Factors in our filings with the SEC and those identified under the section entitled cautionary statements regarding forward-looking statements in our Form 6-K filed with the SEC earlier today.

Thank you for your understanding. I will now hand the call over to our CEO, Adi Hoess, who will provide the corporate update. Adi?

Adi Hoess

Thank you, Anca, and welcome to all the participants. Affimed’s engineering target is immunotherapies, seeking to cure patients by harnessing the power of innate and adaptive immunity. We have an unencumbered clinical and pre-clinical stage pipeline of next generation immune cell engagers based on bi and tri specific antibodies and we use our platform to develop engagers for two distinct types of immune cells, namely natural killer, or NK-Cells, and T-Cells.

Since our NASDAQ IPO, in September 2014, we raised about $120 million in gross proceeds and our cash position, at March 31, was about €66.8 million. We employ about 64 people with headquarters located in Heidelberg, Germany, and offices in Mainz, Germany, Plzen in Czech Republic, and New York and Boston in the U.S.

On Slide 4, you can read about our highlights in the first quarter of 2016. We have been making progress with our lead candidate AFM13 to develop it in combination with anti-PD-1 in relapsed/refractory Hodgkin lymphoma patients. In January, we ended into an important collaboration with Merck in the U.S., we evaluated AFM13, a bispecific CD30/CD16A NK-cell-engaging TandAb in combination with Merck’s anti-PD-1 antibody KEYTRUDA pembrolizumab in Hodgkin lymphoma patients relapsed or refractory to chemotherapy, including Adcetris.

We, as sponsor, have recently initiated a Phase Ib trial and the first sites are open and the study is recruiting. The study both be conducted in the U.S. and we are excited to work with some of the best centers in the field including the Mayo Clinic with Steve Ansell as Principal Investigator, Washington University in St. Louis and other centers. We anticipate providing a first update on this study by the end of 2016 or in the first quarter of 2017.

In January of this year, we hosted a KOL Day in New York with four world-renowned experts in the fields of Hodgkin lymphoma, immunotherapy and NK-cell biology, discussing the current status of and future options for Hodgkin lymphoma treatment. The experts outlined the existing need for novel HL therapeutics. The focus in frontline therapy is to maintain efficacy, however improves safety because toxicity is high and side-effects lasts long-term.

The experts highlighted the potential of immunotherapies to meet this need, particularly in combination therapies with checkpoint modulators. One of the experts at our KOL Day was our collaboration partner hold record of Stanford University. Holbrook passed away in February of this year and we were deeply saddened by his death. Holbrook has been an exceptional supporter of Affimed and a distinguished member of our SAB. He will truly be missed and we are grateful for his tremendous contributions not only to fight against cancer, but also for his significant impact in the field paving the path to creating novel therapeutic strategies in cancer immunotherapy.

At AACR this year, we presented three posters including additional preclinical data on the AFM13 anti-PDI combination from our collaboration with Holbrook Kohrt at Stanford University. We provided further evidence of the synergies between AFM13 and anti-PDI checkpoint inhibitors indicating that AFM13-mediated tumor infiltration and activation of different immune cell subpopulations is the molecular basis for the higher efficacy observed for AFM13 in combination with anti-PD-1 treatment. And that AFM13 induced crosstalk between innate and adaptive immunity enlisted integrate immune response.

By letting our progress in developing NK and T-cell-engaging TandAbs for the treatment of solid tumors, we also presented posters of our preclinical candidate targeting EGF receptor wild type, which is our NK-cell-engager AFM24 and preclinical candidates targeting EGF receptor variant III comprising our T-cell-engager AFM21 and our NK-cell-engager AFM22. All three candidates have shown higher specificity and cytotoxic potency in vitro.

As mentioned in our last call, we made important additions to our management Supervisory Board and Scientific Advisory Board in January of this year, adding Dr. Joerg Windisch to our management as new Chief Operating Officer, Dr. Bernhard Ehmer to our Supervisory Board, and Dr. Andy Evens to our SAB.

Slide 5. We’re a global leader in natural killer cell-based immuno-oncology and we believe that AFM13 is the most advanced NK-cell-engaging antibody in clinical development. The bispecific TandAb AFM13 binds to CD16A on NK-cells and CD30 on tumor cells thereby killing the tumor cell. We defined AFM13 as an antibody specific to the receptor CD16A, which we believe is the most important – is the most potent known on/off switch on NK cells.

And this approach is unique in the industry and could potentially become a second cornerstone for novel therapies in addition to T-Cell redirection through CD-3, an approach pursued by several different companies. To solidify our leadership in the space, we were developing further NK-cell engaging TandAbs, which I mentioned earlier and which we expect to enter R&D enabling studies in 2016.

Slide 6, NK-cell are a part of the ignite immune system and are also the gatekeeper of adaptive immunity. Once engaged NK-cells can ignite the entire immune cascade beginning with antigen presentation and leading to T-Cell activation. And NK-cells play a key role in stimulating the adaptive immune response, and as mentioned our lead candidate, our AFM13, is the clinically most advanced NK-cell-engager to date. At the monotherapy, AFM13 was well tolerated and demonstrated clinical and pharmacodynamic activity in heavily pretreated Hodgkin lymphoma patients. Due to its favorable safety profile, we explode the combination of AFM13 with a variety of anti-cancer drugs, including checkpoint inhibitors.

And in preclinical experiments, we most recently have shown that AFM13 acts in synergy with checkpoint inhibitors as shown on Slide 7. Efficacy is being assessed by vitro cytotoxicity and in patient derived PDX in vivo models, showing models that developed actual human tumors with AFM13 anti-PD-1 antibodies and controls. In deed in vivo synergy of AFM13 and anti-PD-1 in combination was observed. In the same models, we were able to show that AFM13 induces cross-talk between innate and adaptive immunity.

We showed consistently in four individual studies of in vivo PDX models with human CD30-positive Hodgkin lymphoma tumors that AFM13 as monotherapy, but not anti-PD-1 as monotherapy enriches the tumor in microenvironment with NK-cells; this uptake of NK-cells were further enhanced by the combination of AFM13 and anti-PD-1. Furthermore, we showed that the combination leads to an enhanced tumor uptake of macrophages, dendritic cells and T-cells as well as substantially elevated levels of cytokines including interferon gamma. This shows that AFM13 alone or in combination with PD-1 can indeed activate the anti-immune cascade.

Slide 8. As mentioned earlier, the renowned experts at our KOL Day discussed that there is a high medical need in frontline Hodgkin lymphoma therapy for safer, but still effective treatments. Established standard therapies like chemotherapy causes life-long debilitating side effects and there are also better solutions required for elderly Hodgkin lymphoma patients. We do not respond as well to existing treatments.

From the recent studies conducted becoming more and more apparent that immunotherapies, especially combination therapies, promise to address needs. In this context, NK-cell engagement may enhance the therapeutic effect through activation of both innate and adaptive immunity. We were therefore very excited to have initiated a combination study of AFM13 with KEYTRUDA. In addition, we have been further exploring opportunities for the combination of AFM13 with other therapies.

Slide 9. Based on the data from our analysis of AFM13, especially in combination with CPIs, we believe that our NK-cell TandAb platform has the potential to create transformative new drugs to treat cancer.

For us a AFM13 is a dual opportunity both as a drug with the potential to be a saver and highly efficacious treatment for CD30 positive malignancies and also because we believe that it will validate the CD-16A NK cells platform for applications to solid tumor indications.

AFM13 currently is the only most advanced specific NK-Cell engager in the clinic increasing natural killer cell tumor penetration. This approach has the potential to restore the anti-immune cascade for a more robust and lasting fight against cancer cells. To-date our NK cell approach has demonstrated a favorable safety profile, no CRS, with no MTD reached in the AFM13 Phase I monotherapy study.

For our AFM13 Phase IIa monotherapy and relapsed/refractory Hodgkin lymphoma which is IST trial sponsored by the German Hodgkin Study group recruitment is ongoing. However we are experiencing slower recruitment into the trials. We believe this is mainly due to two factors mainly delays in opening additional trial sites and the much earlier availability of anti PD-1 antibodies for the treatment of relapsed refractory Hodgkin lymphoma patients.

We intend to provide an update on time lines and status once more information on the enrollment trend becomes available. We do not anticipate that either of these factors however will influence the combination study. In addition to these trials and the recently initiated combination study of AFM13 was KEYTRUDA, we anticipate providing a first update at the end of 2016 or in the first quarter of 2017.

We are also supporting a investigator sponsored translational of Phase 1b/2a trial of AFM13 in CD30-positive lymphoma with cutaneous manifestations that could broaden the market potential. This study is designed to enable multiple biopsies and we will thereby gain critical insight into recruitment of NK cells into the tumor over time. This trial and additional preclinical work will enable us to better understand NK cell efficacy in the tumor environment and its influence on the adaptive immune system.

The Phase 1b/2a trial is sponsored by Columbia University and an IND was submitted to the FDA that has since become effective. Very importantly with recent initiation of our AFM13 KEYTRUDA combination trial we have broadened our clinical development approach in Hodgkin lymphoma addressing the competition from Adcetris and PD-1 monotherapy.

We believe that there are further combination opportunities for NK cell engaging antibodies and we are exploring additional options to expand the preclinical and clinical activities in both haematological and solid tumors.

Slide 10, in addition to NK cell engagement, Affimed’s developed in highly specific T-Cell engagement TandAb. Efficacy with bispecific T-Cell engagers has been demonstrated predominantly in blood cancers and the first T-Cell engager Blincyto has now been approved in the U.S. and Europe for the treatment of ALL. How ever with T-cell based approaches safety issues must be carefully managed.

The bispecific T-Cell approach in ALL showed that interruption of dosing was an effective way of resolving critical safety issues. Overall convenience and cost of goods remained key issues in the currently investigated T-cell based approach.

Our lead T-cell engager candidate AFM11, a tetravalent CD19 CD3 targeting molecule is being developed to address these issues. And as a potential competitor to Blincyto with a well differentiated TPP. We believe that AFM11 has advantages in terms of potency, convenience and efficacy and COGS. And we see a strong market potential in large indications such as non-Hodgkin lymphoma and also in ALL.

A Phase I dose escalation in NHL is ongoing and we expect to report first data by the end of 2016. We also plan to initiate a Phase I dose escalation in ALL in the third quarter of this year. Due to the availability of [indiscernible] we have decided to run the trial in Czech Republic, Poland and Russia. We are engaging in additional administrative efforts to initiate trial sites in these countries leading to a slight delay in trial initiation.

Slide 12, we have also developers in immune cell engagers targeting solid tumor indication. As we presented most recently at AACR we have generated both NK and T cell engagers for solid tumor indications. All three AFM21, 22 as well as AFM24 have shown excellent specificity through their respective targets in high cytotoxic potency in vitro.

EGFRvIII is tumor specific antigen and we have been positioning our EGF receptor targeting T-cell engager AFM21 in solid tumors such as glioblastoma multiforme. And AFM22 the EGFRvIII targeting NK-cell engager in indications like head and neck cancer, bothmolecules have shown potent in vitro cytotoxic and no killing with antigen negative cell lines.

AFM24 our EGF receptor wild type targeting NK cell engager is planned to be developed for multiple indications including lung, head and neck and colon cancer. In which EGF receptor wild type is validated tumor antigen. AFM24 shows strong antigen binding and cytotoxic activity in vitro and is cross reactive to cyno EGF receptor and CD16A. We have identified a lead molecule and initiated cell line development. Our molecule is well differentiated from Cetuximab in vitor.

The binds to NK cells was much higher affinity almost a thousand fold is more potent in killing EGF receptor wild type expressing cells and importantly it kills cells independent of their mutational status EGFR. As a NK cell engager AFM24 may also be synergistic with other CPIs and hence represent an attractive opportunity for solid tumors such as lung and others.

We also are developing Trispecific antibodies molecules that can recruit immune cells with higher affinity and point to two tumor cell targets. With our Trispecific platform, we are enabling combination of tumor targeting, checkpoint modulation and immune cell engagement.

Our Trispecific Abs are designed to allow for a dual targeting of tumor cells, binding to two different targets that are both expressed on the same tumor cells and a third target for the recruitment of T or NK cells. In our Trispecific program we have established proof of concept for dual tumor targeting in multiple myeloma where we were able to show specificity through bivalent binding.

Our other preclinical program include a T-cell redirecting bispecific CD30/CD16 antibody developed under a license and development agreement with Amphivena and in collaboration with Janssen for the treatment of AML and other haematological malignancy. Janssen has a exclusive option to acquire Amphivena on approval of an IND application.

In preclinical studies the lead drug which is based on Affimed extended platform has demonstrated potent and some cytotoxic activity in AML patient samples as well as a robust tumor growth inhibition and complete elimination of leukemic blast in xenograft models.

Slide 14, to summarize our pipeline comprised of six programs directed against targets such as CD30, CD19, EGF receptor variant III, EGF receptor wild type CD33 and multiple myeloma targets. Our NK-cell-engager, AFM13, is being investigated in three clinical studies, most importantly in combination with KEYTRUDA for the treatment of relapsed/refractory Hodgkin Lymphoma patients.

Our T-cell-engager, AFM11, is being investigated in an ongoing NHL trial and an upcoming ALL trail, offering a second therapeutic option in addition to Non-Hodgkin Lymphoma. Operating pipeline has been progressing and we have identified final development candidate for AFM21, AFM22 and AFM24. Cell line generation has been initiated and further preclinical work is ongoing.

The six programs in collaboration with Amphivena/Janssen is investigating a T-Cell TandAb directed against CD33 or AML. Our trispecific approach takes advantage of the four domain nature of our platform allowing the generation of multi-specific antibodies. Our initial goal is to generate Trispecific Abs that recognizes two different cancer cell antigens in addition to an effective cell antigen.

This could result in high affinity and importantly increased selectivity for malignant tissues as compared to healthy tissues. This platform would offer an expansion of the target space for selective targeting of tumor cells versus healthy cells and we have initiated a discovery program for the therapy of multiple myeloma for which we have also been awarded a research grant from the German government in early 2015.

I will now hand over the call to our CFO, Florian Fischer, who will provide further details on the financial figures.

Florian Fischer

Thank you, Adi. Affimed’s consolidated financial statements have been prepared in accordance with IFRS as issued by the International Accounting Standards Board, or IASB. The consolidated financial statements are presented in euros, which is the company’s functional and presentation currency, therefore all financial numbers that I will present here in this call unless otherwise noted will be in euros. Any numbers referring to Q1 2016 and Q1 2015 are unaudited.

Cash, cash equivalents and financial assets totaled €66.8 million as of March 31, 2016 compared to €76.7 million as of December 31, 2015. The decrease was primarily attributable to Affimed’s operational expenses. Affimed expects to have cash to fund operations until the first quarter 2018. This provides runway for the plant development, our clinical programs as well as for further discovery and early development activities.

Net cash used in operating activities for the first quarter 2016 was €8.5 million compared to €3.9 million for the first quarter 2015. The increase was primarily related to higher cash expenditure for research and development in connection with our development and collaboration programs.

Revenue for the first quarter 2016 was €1.9 million compared to €2.5 million for the first quarter 2015. Revenue in both periods was primarily derived from Affimed’s collaboration with Amphivena and from third-party services rendered by AbCheck.

R&D expenses for the first quarter 2016 were €7.1 million compared to €2.9 million for the first quarter 2015. The increase was primarily related to higher expenses for AFM13, preclinical programs and infrastructure. G&A expenses for the first quarter 2016 were €2.1 million compared to €1.8 million for the first quarter 2015.

Net loss for the first quarter 2016 was €8.5 million, or €0.25 per common share, compared to a net loss of €1.5 million, or €0.06 per common share, for the first quarter 2015. The increase in net loss is primarily related to increased spending on R&D for AFM13, preclinical programs and infrastructure. In addition, net loss was affected by finance costs of €1.3 million in the first quarter 2016, of which €1.1 million were exchange losses, whereas finance income of €0.5 was shown in the first quarter 2015.

I will now turn the call back over to Adi for a summary of our clinical programs in our pipeline. Adi?

Adi Hoess

Thanks very much, Florian. Our strategy is to maximize the value in our pipeline and platform. We’re leveraging our lead product AFM13 for CD30 positive lymphoma. We are therefore initially focusing on the Hodgkin's lymphoma salvage setting, enabling a fast development path and allowing the establishment of a cost efficient marketing and sales infrastructure.

In addition, we believe investigating AFM13 dose as monotherapy and in combination with KEYTRUDA reduces its development risk. Our very encouraging preclinical data generated in collaboration with Stanford University have underlined the promise of AFM13 holds as a combination therapy partner. Overall our preclinical and clinical strategy is designed to broaden the scientific leadership of our NK cell platform, and we plan to expand the preclinical and clinical activates of our NK cell on that platform in both hematologic and solid tumors.

Thank you very much for your interest, the call is now open for questions.

Question-and-Answer Session

Operator

Thank you. [Operator Instructions] We will now take our first question from Michael Schmidt with Leerink Partners. Please go ahead.

Michael Schmidt

Hey, thanks for taking my questions. So I had a couple on AFM13. Number one, the Phase 2a monotherapy study, I guess how many patients have enrolled to-date? And can you speak to the importance of that data set coming out of that Phase 2a study? I recall this is a PK/PD study trying to optimize the dosing schedule. I was wondering how important that data is for the ongoing PD-1 combination study.

Adi Hoess

Thanks, Michael. So just to – repeat what I’ve said before, this trial is an investigator-sponsored study and is supposed by the German Hodgkin Study Group. And as mentioned, we are experiencing slower recruitment into the trial. So we believe – as I said before, this is mainly due to these two factors. The study group has been much slower in opening additional trial sites and what we originally plan and we had PD-1 antibodies now, I mean to be basically – they are available for the patient.

And so cancer immunotherapy treatment landscape isn’t quite evolving. Indeed the patients recruited into our trial, are of course heavily pretreated in this early availability of anti-PD-1 as another line of treatment before AFM13.

In terms of data, we had guided for an update on interim data, i.e., treatment of 20 patients. And indeed not enough patients have yet been enrolled. But I can say is that, the recent availability of these patients clearly had impacted enrollment and we now need to determine on how quickly we can go ahead. We were saying that we would want to provide you an update after 20 patients roughly being enrolled. And so, we probably can tell you a bit more within the next two months on how these – how the enrollment periods are progressing.

To give you an answer on the second question, we had already very good data in the Phase 1 study where we identified our dosing regimen. So what we have been doing is an optimization of the dozing regimen. And we had two other experiments for the input into the design of the combination trial. And hence the data as we pointed out, they definitely will be useful, but we can run the combination trial based on the information that to-date is already available. So we don't have to basically change or make any adjustments into that trail, into the – talking about the communication trial.

Michael Schmidt

Okay. Can you remind us of the dosing protocol in KEYTRUDA combination study?

Adi Hoess

Yes. So in short what we are doing is we are dosing KEYTRUDA every three weeks. We are starting dosing AFM13 one week post the first KEYTRUDA dose. Initially patients will receive doses three times per week for the first two weeks, then continued by once weekly dose for the next six weeks, and then we will dose patients with AFM13 and KEYTRUDA in parallel for every three weeks post that initial AFM13 more frequent dosing.

Michael Schmidt

Okay, thanks. And then I guess more bigger picture, you've said you've encountered some issues with patient availability with the availability of PD-1 antibodies. What's your view on how the pending Seattle Genetics ECHELON-1 trial resides in frontline will change the treatment paradigm in Hodgkin's lymphoma. How might that affect the market opportunity for you in later line therapy?

Adi Hoess

Yes. Well, indeed it's a very good question. So obviously we don't know the data yet, so waiting and speculating about data that do not alter. Probably I can give you quite a variety of opinions around that. So at that stage I think it's much better for us to await the data, but we however – our focusing is a different aspect. So we’ve learnt that both therapies as monotherapy, so Adcetris and PD-1s are already quite active. However, when you compare the CRS, there is a difference.

And as it looks as of today, Adcetris is as high as CRS in that context while PD-1s have [indiscernible] duration of a response. And obviously based on our preclinical data, we think that we can help optimizing the PD-1 response, that’s why we are quite excited about now initiating the trial of AFM13 in combination with KEYTRUDA, and obviously we are aiming at improved CRS in that context.

So that picture or that situation now can address as I’ve said before, the high needing Hodgkin's lymphoma which is still to improve the safety and toxicity of the therapies. At our KOL day, we have learned that patients are suffering lifelong from these toxicities which even ends or could end in a secondary malignancies. And as you know some of these patients when they are diagnosed first with Hodgkin's lymphoma are still very young. So they need – definitely need other options and we feel that with immunotherapies we can address this option in a very distinct and specific manner.

But just repeating myself, combining AFM13 with KEYTRUDA and optimizing the results there that will be key to us, and based on that we can finally decide which indications to pursue first in that context. And if the opportunity turns out to produce the data that we're expecting, we may be able to address front-line development in a very fast manner.

Michael Schmidt

Okay. And then one more on AFM24, the EGFR wild type bispecific specific product candidate. I guess to what degree are you worried about on target side effects from my understanding is that ORBITREK for example some of the toxicities are being seen are target related, skin rash for example. I guess to what degree is that an issue for a more potent molecule in your view?

Adi Hoess

Yes, it’s a very good question, and so we have been obviously discussing that internally, and with experts in a very broad context. The number one thing we've learned is that if we're seeing similar side effects, physicians know how to deal with the side effects. So it's not some – that's important. So even if we see side effects, but these are similar than those before, then we have a clear-cut picture on how to deal with that.

Obviously, the drug, Cetuximab is a full-length IgG. So these effects may not just caused by biding, but as we know full-length IgG have additional features, they do bind a variety of immune cells and not specific just for NK-cells.

And secondly, through the FcRn binding you also have a different and a very distinct feature built in there. This is not just relating to a longer half life, but it is also important for other effects of such antibodies. Let me just recall TandAbs do not bind FcRn. And thereby we have a very distinguished product. As mentioned before that we have engineered the molecule AFM24 to be cross-reactive with EGF receptor wild-typeandCD16A in Sino. And these studies are very important for us to be conducted and they eventually can tell us a lot more.

Let me add to that just one more piece. If you evaluate the side effects of some of the other drugs that are directed again EGF receptor wild-type, they displayed in the clinic a variety of different types. I don’t want to go into detail into that, but again it is not yet clear to us by having evaluated a literature and the data is just targeting EGF receptor wild type may cause always just skin rashes. So there is totally different feature seen from other drugs in that context regarding safety and we just need to evaluate our drug.

So we view this as a very significant option because the major difference between Cetuximab and AFM24 is a much higher affinity and specificity for NK-cells. And it is not clear if Cetuximab would really display the significant immunotherapeutic effect. It acts by blocking receptor ligand interact. And ADCC has been described but we don’t know about its importance in that front. So we are – with AFM24 really may have a very distinguished drug, because therefore the first time providing specific NK-cell engagement and as a fact our opportunity drug that we are conducting in the near future will just help us to verify that particular approach.

Michael Schmidt

Okay thanks again.

Adi Hoess

As a last stands on AFM24 – yes, as a last stands on AFM24 we have AFM22 which is a specifically targeting EGF receptor variant III. So here we have another molecule that’s much more specific for a sub-variant of EGF receptor wild type and that is also designed in NK-cell-engager system. So we have another opportunity to compare these molecules.

Michael Schmidt

Okay, great thanks.

Operator

We will now take our next question from Do Kim from BMO Capital Markets. Please go ahead.

Do Kim

Hi good morning. Thanks for taking my questions. So you mentioned that PD-1 inhibitors are much more available now. And now with the approval of Opdivo in Hodgkin's lymphoma here in the U.S., how do you see your clinical development strategy changing for AFM13. Could KEYTRUDA combo have a higher priority over the monotherapy? And what does that mean for moving to frontline Hodgkin's?

Adi Hoess

Very good question thanks a lot. So at the moment we are indeed dealing with those studies and giving it the same priority. But as again the experts have outlined a very strong immunotherapy is the highest desire currently in Hodgkin's lymphoma and obviously we are already seeing very good data with PD-1 monotherapy already. On the other side, we also had seen very encouraging data of AFM13 as a monotherapy now a Phase 1 trial.

So combining these two drugs and as shown in our PDX models there has been a substantial improvement in terms of efficacy. So we are quite – actually they were quite excited, obviously about the data that are available from all different experiments and obviously there is a strong focus now by us on the combination trial and its outcome.

On the other side we also see that PD-1 is moving along in different settings, in different treatments lines of Hodgkin's lymphoma. So what we have seen by Opdivo is now is in the approval in the salvage setting post Adcetris is definitely not the end. So PD-1 will and is already investigated in different subsets. So that could give us the opportunity if the combination has an additional benefit to really to go along with PD-1 therapy in the future and thereby have a significant impact on the speed of development for AFM13.

So that's what we have learnt from investigators. So they are equally excited about monotherapy and combination therapy. But especially if we're seeing a change in the outcome of the combination therapy i.e. a higher complete response rate, this is extremely exciting to the physicians and obviously there by to the patients.

Do Kim

Okay. And then a follow-up on that, do you see the population of patients moving forward in the relapsed refractory setting be mostly PD-1 inhibitor experience and have you investigated AFM13 in any patients that have been on PD-1 inhibitors before?

Adi Hoess

So to give you an – and answering your first question, currently we see an impact of the availability of PD-1 in our trial. So obviously we're experiencing patients that are – so our enrollment criteria say that they had to have both standard lines of therapy including Adcetris. And some of the patients that are included in the trial indeed had been treated with a PD-1 antibody. That is a – that’s let's say not a new patient group, but that's definitely a newer situation that we have to evaluate that.

Being still early in the trial, we cannot give you any insight into that as we have no answers yet to if that impacted and what it does. But obviously we're exactly learning what you just have been asking that we get a mix set of patients, some that have been only on Adcetris and others that had Adcetris and PD-1s as prior treatment.

Do Kim

Okay, thank you. And for AFM11 in your NHL Phase 1 study, do you have a sense or visibility into what subtypes of non-Hodgkin’s lymphoma are being enrolled into that trial?

Adi Hoess

Well, the trial is indeed including all subsets of patients. So there is no real trend in that context still this is a dose escalation trial and as you know there is always very few patients engulfed and enrolled in such trials. So the trial is open for a wide variety and so we cannot see and probably also after the trial we cannot determine yet to trend. So what we will thereby do is once we have established the safety of our drug we're planning to do a dose expansion and cohort expansion and that predominantly, obviously we’ll be focusing on diffuse large B-cell lymphoma. But that is not the case for the dose escalation.

Do Kim

Okay. And with the data at year end have subset analysis by subtypes?

Adi Hoess

I can't tell you. It all depends on what kind of patients are in there and how meaningful that is.

Do Kim

Okay, great. Thank you for taking my questions.

Adi Hoess

Thanks a lot.

Operator

We will now take our next question from Brian Abrahams from Jefferies. Your line is open. Please go ahead.

Maury Raycroft

Hi thanks for taking my question. This is Maury on for Brian. As kind of a follow-up to their previous questions, I'm wondering if for the monotherapy GHSG trial, I'm assuming that a decent amount of those patients will be PD-1 failures. And I’m wondering what the efficacy readouts from that trial will be?

Adi Hoess

What we’re doing so the endpoint in the trial is objective response rate after three months that’s a primary endpoint. Secondary endpoint is response rate after six months and PFS. Did that answer your question?

Maury Raycroft

Yes. And so if some of those patients are PD-1 failures, I guess, what is your view on how that could affect our results with AFM13 monotherapy? So particularly if the immune system is somewhat exhausted by the PD-1 treatment how that could affect efficacy?

Adi Hoess

As I say this is a situation where – which we are experiencing in the trial but we do not yet have insight into the data in order to give you an answer to that if it is impacting or not. So we need to treat more patients and then we should be able to highlight at least some of the prior treatments on having to see effect on our drug. But for the time being we’re just not able to comment on that in any detail.

Maury Raycroft

And as far as the washout period goes from prior treatments, can you remind me what the details are for them? And…

Adi Hoess

Yes, okay. Right, I don't have the exact numbers in front of me but I believe it is four weeks usually.

Maury Raycroft

Okay. And so we see any data in 2016 from that trial, so I think we were previously expecting an interim in this quarter. So is it possible that we’ll reach the 20 patients by the end of 2016 or is that so unclear?

Adi Hoess

It is – well, what we have been doing is we only have limited implants on that trial as it is a nice team. And that makes it a bit more challenging for us in order to give you obviously exact timelines simply for the reason that the German Hodgkin Study Group is really implementing all such measures. We have been seeing now a very recent availability of PD-1 and as that only happened within the past really two months maybe three months in that context, we now need to analyze that for the next couple of months in order to better understand how we can best deal with that. So giving you any guidance or giving you any idea on that would obviously not be – would not be fair at that context, so just give us a couple of months to analyze that data.

Maury Raycroft

Okay, and then separate front I notice that a paper is published recently at the University of Minnesota with Jeff Miller as an author. And so they are showing that they can use IL-15 as a cross link or two enhance NK cell function. I was just wondering if you had any views on that, that idea of using IL-15 and I believe they’ve designed a trispecific to do this. So I’m just wondering if you had any thoughts.

Adi Hoess

Yes, so, we have been exploring the field of how we can optimize efficacy of NK-cell engagers and there is a variety of options that we have been evaluating and as we said before we also thinking of expanding the route around AFM13 in different kind of areas. And as you’ve mentioned IL-15 is one of several options that we identified. Currently there is a very few molecules in the clinic that already have generated a safety data so that combination studies can initially be initiated but we are thinking that the study is probably will be completed very soon and then options may widen.

So IL-15 is one way of addressing that for example and other idea is obviously to work with activated natural killer cells is not an option but we are very close to people that are developing such therapeutics and have intense discussion that’s all what I can say for the moment.

Maury Raycroft

Okay. Thank you for taking my questions.

Operator

[Operator Instructions] We will now take our next question from Yale Jen from Laidlaw and Company. Please go ahead.

Yale Jen

Good morning and thanks for taking the questions. This is again a little bit follow-up on the previous one, which is for the AFM13 monotherapy giving the sort of delay for the patient recruitment and the potential available of PD-1 first of all would you anticipate this study more geared to I mean in terms of patients available more geared to PD-1 failure patients or you think that used to give some sort of PD-1 naïve patients into the study.

Adi Hoess

Hi, Yale, thanks for the question.

Yale Jen

Hi.

Adi Hoess

Very good question, indeed again I cannot give you an answer yet to that because as I said before we have a Phase 2 study ongoing is monotherapy and we are rolling a variety of patients as you know we are still dosing the patients with two different regimens. One regimen uses three times per week or two weeks and then continuing weekly, and the second regimen is dosing patients three times per week or eight week. So we have now a variability in their regarding dosing and also regarding the patients plus/minus PD-1 so we just need to continue enrollment of the trial in order to better understand that if we can see an effect in patients that have PD-1 relapses and not just been treated with chemotherapy prior to that.

So this is a very reasoned and it’s a new situation. Having said that it looks a bit different when you look at the combo trial, so there we are not in competition with the patients that are either going on Adcetris or on PD-1 here we are in synergy at least with the PD-1 antibodies. As we are doing this trial in combination with KEYTRUDA, so we are – on the one side obviously looking into the effect of what AFM13 can still have in heavily pretreated patients but on the other side we are also moving along and moving product indeed on the lines of treatment.

So KEYTRUDA, a combination trial is build on in patients refractory to Adcetris but obviously these patients will not have had PD-1 as a prior therapy. So we are not including PD-1 relapsing or refractory patients in this combination trial. In terms of where the focus of our drug will be yes, the monotherapy trial is important but its just one component of the entire development strategy the company has. And as we just recently now initiated the trial and the centers are highly committed and have just mentioned the name of the centers and the participating physicians.

So these are really they’re world-class experts that have enrolled such patients in the largest numbers into PD-1 monotherapy trials. I think we are dealing with the right centers, we are dealing with the right physicians and we have an excellent partner with Merck. So in that sense, in our mind what we are doing with AFM13 is very positive although we are experiencing some issues on the monotherapy. And but again this is usually happening when new drugs come to market and situations for a short time usually look a little bit more confusing but overall once time passes by a little bit then its gearing up and we are just learning out of that.

Just be patient on the monotherapy trial in that context we have to accept I think the circumstances but that being able to run all the combination trial and having that kicked off and again that’s an Affimed’s sponsored trial. So this is much more under our uncontrolled so we look forward to presenting data on that combination trial indeed very soon.

Yale Jen

Okay. Great, that’s very, very helpful and I just switch gear to AFM11 in terms of the ALL study that to start. In third quarter you mentioned that this study will be conducting in East European countries, would you think those probably will be more of the Blincyto naïve patients or you will get both treated and experience in the naïve patients and that regard and how do you see do you have any more color in terms of our current expectation on that?

Adi Hoess

Yes, thanks for that question. So obviously, there has been a slight delay but in that context it just relates to regulatory administrative issues in order to open sites in Czech Republic and Poland and in Russia. When we did our analysis of these centers we learned that we these centers are all highly sophisticated in early capable of running such trial some of these centers indeed participated already in Blincyto trials but we have very experienced physicians and that’s why we chose these respective countries. And that’s important because T cell engagers are very powerful drugs that indeed very where we may expect also some side effects and they need to be carefully manage. So we have security going to Czech Republic, Poland and Russia and working with specific centers that is guaranteed. So we are again working with very excellent centers in that context.

To your question will these patients being treated with Blincyto, no. So, we will treat patients that are naïve to Blincyto and thereby as prior therapies obviously chose that chemotherapy.

Yale Jen

Okay, great. And last question here with a little bit housekeeping which is that we already – already passed the first quarter of 2016. So I wonder what are you guys have a little bit more color in terms of guidance, in terms of top line that the revenue side for remaining of the year, it seems to little bit higher than I anticipate for this quarter so was there any colors on that and thanks for taking the questions.

Adi Hoess

Thank you for this question. On the revenue side, you have not given any further guidance on that. I would like to remind you that the – again the majority of our resources for the revenue that we now reported in the first quarter are derived from the MT data and uptick – and from uptick we have not given any further guidance with regard to any further revenues generated by other PD activities in that respect.

Yale Jen

Okay. Thanks for taking the questions.

Operator

There are no further questions in the queue. I will now hand the call back for any closing or additional remarks.

Adi Hoess

No other remarks from our side. Thank you very much for joining the call and for participating in our update call. Thanks a lot.

Operator

Thank you. That will conclude today’s conference call. Thank you for your participation ladies and gentlemen. You may now disconnect.

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